Table of Contents :
• Stock Rating & Target Price
• Investment Thesis
• Fundamental Models Used
• Company Description
• Corporate Timeline
• Key Metrics (KPI ) and Recently Reported Earnings Review
• Business Highlights, Strategic Announcements & Outlook
• Quarter-over-Quarter (Q-o-Q) and Year-over-Year (Y-o-Y) Growth Analysis
• Key Catalysts Driving Growth
• Historical Financial Statement Analysis & CAGR Trends
• Quarterly Key Financial Ratios and Performance Metrics
• Annual Financial Performance Analysis: Horizontal and Vertical Financial Analysis, Trends
• Financial Forecasts
• Annual Forecasts: Income Statement
• Annual Forecasts: Cash Flow Statements
• Net Debt Levels
• A Closer Look at DCF: Our Assumptions and Methodology
• Terminal Value Calculation
• Target Price Analysis
• Valuation Multiples
• Supplementary Valuation Analysis: Multiples Approach
• Scenario/Sensitivity Analysis – Base Case , Bull Case ,Bear Case
• Holistic Peer Review & Trading Comps: Financial Data, Operational Metrics, and Valuation Multiples
• Implied Price Per Share
• Ownership Activity/ Insider Trades
• Ownership Summary
• An analysis of ESG Risk Rating
• Key Professionals
• Key Board Members
• Key Risks Considerations
• Analyst Ratings
• Analyst Industry Views
• Disclosures
Dayforce: Full-Suite Adoption Driving Growth and Margin Expansion—Will Elevated Customer Stickiness Sustain Profitability?
Dayforce Inc. delivered robust Q3 results, reinforcing an Outperform rating as the company continues to balance growth and profitability. Total revenue grew 17% YoY to $440 million, surpassing expectations by $11.74 million, with recurring revenue up 19% YoY to $333 million. Growth was bolstered by a 15% YoY rise in average recurring revenue per customer and positive customer go-live momentum. Adjusted EPS of $0.47 beat estimates by $0.05, while adjusted EBITDA grew 18% YoY to $126 million, achieving a margin of 28.7%. Free cash flow surged 184% YoY to $117 million, showcasing strong cash flow discipline despite a GAAP EPS miss due to non-recurring expenses. Operationally, a near-80% cloud recurring gross margin and strategic enhancements, such as AI-driven features in Dayforce Copilot and the eloomi platform integration, highlight the scalability and differentiation of Dayforce’s HCM solution. Full-suite deals constituted 51% of bookings, with add-on sales contributing 37%, evidencing wallet-share expansion. Despite elongated sales cycles and a projected float revenue headwind of $25-$30 million, Dayforce’s focus on core HCM revenue and efficiency initiatives supports a positive outlook. FY25 guidance anticipates 14%-15% revenue growth and EBITDA margins above 31%. Can Dayforce sustain its profitability by capitalizing on elevated customer stickiness amid increasing macroeconomic scrutiny?
